New wildfire liability, mitigation laws in effect across Western US

New state-level wildfire-related statutes aimed at mitigating electric utility wildfire risk and liability are now in effect across the Western US, following the conclusion of several state legislative sessions.

➤ Laws addressing wildfire mitigation planning and related civil liability protections are now in effect in Idaho, Montana and Washington, while Hawaii has taken steps through new legislation to codify its own framework to address wildfire liabilities and cost recovery.

➤ In Oregon, legislation proposing a new fund to pay for damage claims arising from catastrophic wildfires did not advance, though a new state fund is available for wildfire suppression, mitigation and prevention

➤ Though no major wildfire-related legislation was passed during Colorado and Utah's most recent legislative sessions, wildfire-related regulatory activity has remained active in these jurisdictions in various rate case, resource planning and accounting-related dockets.

➤ For additional detail regarding other new energy utility statutes passed during the 2025 legislative sessions and Regulatory Research Associates' view on state regulatory climates, visit the Hawaii, Washington, Oregon, Idaho, Montana, Colorado and Utah commission profiles.

Hawaii

Hawaii Gov. Josh Green (D) signed several bills into law in July to improve wildfire prevention, response and recovery, and to establish a state-funded settlement trust to pay claims arising from the August 2023 wildfires in Maui. House Bill (HB) 1064 implements certain recommendations resulting from a third-party investigation into state and county agencies' preparation for and response to the 2023 Maui wildfires; establishes the Office of the State Fire Marshal and a marshal selection commission; and places the fire marshal's office under Hawaii's Department of Law Enforcement. The bill also clarifies the roles, duties, and discretionary authority of both the office and the state fire marshal.

House Bill 1001 establishes a Maui Wildfires Settlement Trust Fund, to be administered by the Hawaii Attorney General, and appropriates nearly $808 million of state funding to help pay settlement claims. Hawaiian Electric Industries Inc. subsidiary Hawaiian Electric Co. Inc. has also agreed to pay $1.99 billion to settle lawsuits related to the wildfires.

Hawaii Senate Bill (SB) 897, enacted on July 1, requires the Hawaii Public Utilities Commission to study the feasibility of a new fund that would pay for damages stemming from future wildfires caused or exacerbated by an electric utility, while protecting the utility's financial integrity. The measure also requires the PUC to initiate a rulemaking to establish an aggregate liability limit for electric utilities for economic damages from future wildfires. The bill also authorizes Hawaii's electric utilities to apply to the PUC to issue up to 30-year bonds to finance new infrastructure resilience costs (also known as securitization) that are not already included in an electric company's rate base.

The HECO utilities also include Hawaii Electric Light Co. Inc. and Maui Electric Co. Ltd. The utilities filed an updated 20252027 Wildfire Safety Strategy in January in Docket No. 2025-0156, which contemplates about $300 million of grid-hardening investments to reduce wildfire risk. The proceeding is ongoing.

Oregon

About a week after declaring a state of emergency due to an imminent threat of wildfire, Oregon Gov. Tina Kotek (D) on July 24 signed HB 3940, creating the State Forestry Department Large Wildfire Fund to pay for wildfire suppression, mitigation and prevention. The fund, underwritten in part by interest generated by the state's Rainy Day Fund and taxes on oral nicotine products, secures $150 million for responding to wildfire disasters over the next two years, and $117 million for community prevention and resilience efforts.

Kotek also signed SB 83 on July 24, which repeals various statutes regarding building standards for wildfire hazard mitigation and the statewide wildfire hazard map. The legislation also directs the state fire marshal and Oregon Department of Consumer and Business Services to develop and adopt a new code and wildfire hazard mitigation code standards to reduce wildfire risk.

The bill additionally requires the Oregon Public Utility Commission to report annually to the state Legislature on actions taken to reduce wildfire risk from utility infrastructure, including updates on the review of wildfire protection and mitigation plans filed by public utilities; summaries of wildfire mitigation best-practice workshops; public safety power shut-offs; expenditures on wildfire mitigation efforts and any recommendations for legislative action, including future resource and funding needs.

During the session, HB 3666 and HB 3917 failed to advance. HB 3666 would have authorized the PUC to issue a "wildfire safety certification" to utilities that have — and have implemented — a wildfire protection plan or wildfire mitigation plan. The measure would have also established a statutory presumption that a utility with an approved plan "is acting reasonably with regard to wildfire safety practices."

HB 3917 sought to establish a state wildfire fund to pay for damage claims arising from catastrophic wildfires. In its last rate case in Docket No. UE 433, PacifiCorp. sought, but later withdrew, a proposal for a Catastrophic Fire Fund (CFF) to pay for wildfire liabilities in excess of insurance coverage.

The company initially proposed to implement a surcharge to collect $77.7 million annually, starting Jan. 1, 2025, to create a fund to facilitate a multistate risk pool for potential catastrophic events, where third-party liabilities are in excess of PacifiCorp's insurance coverage. The company said it intended to refine the proposal and reintroduce it in 2025. The company proposed, and withdrew, a similar fund in an Idaho rate case in 2024 (Case No. PAC-E-24-04); legislation is now in place in that state establishing a statutory wildfire-related liability standard (see below).

Legislation enacted in 2021 requires Oregon electric utilities Portland General Electric Co., PacifiCorp and Idaho Power Co. to file and update wildfire mitigation plans by Dec. 31 annually, that the PUC may approve within 180 days, with or without conditions. Notably, under state law, an approved wildfire plan "does not establish a defense to any enforcement action for violation of a commission decision, order or rule or relieve a public utility from proactively managing wildfire risk, including by monitoring emerging practices and technologies."

Additionally, among the state's available adjustment clauses, a Wildfire Automatic Adjustment Clause is available to electric utilities for the timely recovery of wildfire mitigation-related operations and maintenance expense and capital expenditures.

In August 2024, the PUC opened an investigation in Docket No. UM 2340 into wildfire planning requirements "to facilitate a meaningful, transparent, and robust planning process." The PUC collected comments in the docket through July 11, 2025.

Montana

On May 19, Montana Gov. Greg Gianforte (R) signed into law HB 490, which requires electric utilities to submit a wildfire mitigation plan by Dec. 31 this year, and every three years thereafter. The bill affords certain civil liability protections to electric utilities that have substantially followed approved wildfire mitigation plans.

NorthWestern Energy was authorized in its last Montana-jurisdictional electric rate case to defer, for later rate recovery, incremental wildfire expenses that are capped annually (Docket No. 2022-7-78(elec). In its pending rate cases before the Montana Public Service Commission, NorthWestern Energy Group Inc. is now seeking a new balancing account for wildfire management costs, which may help to further reduce regulatory lag as it pertains to investments in wildfire mitigation programs and insurance costs (Docket No. 2024-05-053(elec)).

On July 22, the Montana PSC opened a rulemaking in Docket No. 2025.07.055 to begin implementing provisions of HB 490.

Idaho

In April 2025, the Wildfire Standard of Care Act (SB 1183, WSCA) was enacted, requiring electric utilities to develop wildfire mitigation plans (WMP) and submit them to the Idaho Public Utilities Commission for approval. The bill, effective July 2025, establishes a statutory wildfire-related liability standard. In a civil action where wildfire-related damages are being sought against an electric corporation, there is a rebuttable presumption that the electric corporation acted without negligence if, regarding the cause of the wildfire, the electric corporation reasonably implemented a commission-approved WMP.

The law also permits electric utilities, with 30 days' notice, to access the property, easement, or right-of-way for the limited purposes of performing vegetation management, fire mitigation work in accordance with a commission-approved WMP, or upgrading, inspecting, or repairing the electric corporation's assets, infrastructure, or facilities. In taking such actions, the electric corporation shall not be held liable in any civil action for claims or damages, except to the extent the electric corporation's conduct willfully or recklessly caused substantial damage to the property.

On June 18, the Idaho PUC staff submitted an application asking the PUC to issue an order establishing a WMP filing process to ensure the state's investor-owned utilities comply with provisions of the WSCA. Staff's application discusses proposed filing processes, staff WMP guidelines and proposed filing dates, and defines items to be included in WMPs with electric corporations and other stakeholders. Staff proposes the following initial temporary filing dates for WMPs for Idaho Power on Oct. 1, Avista Corp. on Oct. 10 and PacifiCorp on Oct. 17.

As in Oregon, PacifiCorp sought authorization to implement a new rider in its last Idaho electric rate case to fund a catastrophic fire recovery fund. Though the Idaho PUC ultimately rejected the request, PacifiCorp has been authorized a new Insurance Cost Adjustment rider in Idaho to recover deferred and prudently incurred excess liability premium costs.

Washington

As a result of legislation enacted in April 2025 (HB 1522), Washington electric utilities must file a wildfire mitigation plan with the Washington Utilities and Transportation Commission as soon as practicable after the bill's July 27, 2025, effective date, unless the company has previously filed a wildfire mitigation plan with the commission prior to the effective date, in which case the company must file an updated plan.

Utilities must file an updated plan at least every three years, and, to the extent practicable, align it with its multiyear rate plan application. The WUTC may recommend or require additional elements or practices to be included in the company's plan. The WUTC also may, in approving the plan or plan update with conditions, make modifications to the plan or plan update that it deems necessary to balance mitigation costs with the resulting reduction of wildfire risk. The WUTC must issue an order explaining any modifications.

Washington utilities have been required since 2021 to submit annual wildfire plans and present them to the WUTC at a public meeting. The plans were to include measures the utilities could use to prevent and respond to wildfires, including vegetation management, investments like line hardening, and various depowering methods. They also covered the utilities' communication plans to customers and thresholds or criteria for implementing any of those tools.

The WUTC reviews utility wildfire mitigation investments during general rate cases and other proceedings. The state's electric utilities include Avista, Puget Energy Inc. subsidiary Puget Sound Energy Inc. and PacifiCorp.

Colorado and Utah

Though no major wildfire-related legislation was passed during their states' respective 2025 legislative sessions, wildfire-related regulatory activity has been brisk before the Colorado Public Utilities Commission (CPUC) and the Public Service Commission of Utah.

In June, Colorado regulators approved, with modifications, Xcel Energy Inc. subsidiary Public Service Co. of Colorado's updated $1.9 billion 2025-2027 WMP, which includes cost recovery of wildfire mitigation investments through a new Wildfire Mitigation Adjustment rider, and recovery of related transmission investments through PSCO's Transmission Cost Adjustment rider. PSCO's public safety power shut-off plan was also approved, and the company's tracker for excess liability insurance costs was also extended.

PSCO submitted the first iteration of its wildfire plan in a rate case decided in 2020 (Docket No. 19-AL-0268E). The utility sought and ultimately received authorization to recover certain transmission and distribution operation and maintenance costs associated with wildfire mitigation activities in 2019 as part of a settlement agreement.

As a result of legislation enacted in 2024 in Utah, PacifiCorp is authorized to establish a Utah-jurisdictional wildfire fund and related surcharge to pay for wildfire-related damages levied against the company. The company has thus far unsuccessfully sought new accounting orders in the state for third-party wildfire liability costs and rising excess liability insurance (ELI) costs.

In an April decision in the company's electric rate case in Docket No. 24-035-04, the Utah PSC rejected the utility's request for a new rider to pay for ELI costs. It also affirmed a March 2024 order that denied PacifiCorp's request for a deferred accounting order to defer and track ELI costs, due to the PSC's determination that the utility is unlikely to recover these expenses in a future rate case. The company was ultimately authorized to recover $11.6 million of ELI premiums, based on similar costs in the company's previous rate case, and updated to reflect commensurate recent premium increases of peer utilities.

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